DIA Issues Formal Warning To Mills Gibbon And Co Limited For Anti-Money Laundering Non-compliance

Te Tari Taiwhenua - Department of Internal Affairs (DIA) has issued a formal warning to real estate agent Mills Gibbon and Co Limited under the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act).

The Wellington branch of Mills Gibbon and Co Limited failed to meet its Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) obligations relating to the establishment, implementation, and maintenance of an AML/CFT programme, failing to conduct customer due diligence, and failing to keep records.

Of particular concern to DIA is that Mills Gibbon and Co Limited failed to report suspicious activity on several of their listed properties.

Under the AML/CFT Act, real estate agents are required to monitor their customers for suspicious transactions or activities. If suspicious transactions or activities are detected, they must be reported to the New Zealand Police Financial Intelligence Unit.

Mills Gibbons and Co Limited breached the AML/CFT Act and in doing so failed in their regulatory obligations. This warning does not allege that Mills Gibbons and Co have been involved in money laundering or the financing of terrorism. The company must take immediate action to rectify all areas of non-compliance with the AML/CFT Act. DIA will continue to monitor Mills Gibbon and Co Limited to ensure they improve the effectiveness of their practices, policies, procedures and controls to prevent them being exploited.

“Real estate is used by criminals to launder money, domestically and internationally so real estate agents must have robust processes in place to manage and mitigate the risk of being misused by criminals” says Mike Stone, Director AML/CFT, DIA.

“DIA's AML/CFT Group is committed to ensuring New Zealanders can trust the integrity of the real estate sector and we will continue to actively work with the sector in a range of ways to ensure compliance with the AML/CFT Act. Real estate agents have been captured by the AML/CFT Act since 2019, so more than sufficient time has passed to allow real estate agents to understand their obligations and implement proper controls. A compliant Real Estate sector is essential to prevent, detect and deter criminals from using real estate as a method to clean their dirty money. We need real estate agents to understand the significant role they play in the AML/CFT system and in protecting the integrity of our financial system, and of the real estate industry as a whole.”

The formal warning to Mills Gibbons and Co limited was issued on 20 October 2023 under section 80 of the AML/CFT Act.

Mills Gibbons and Co Limited has demonstrated commitment towards improving their AML/CFT programme since DIA identified this non-compliance.

© Scoop Media